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Page added on September 10, 2012

Progress on GMR project awaits ACC investigations

Progress on GMR project awaits ACC investigations thumbnail

President of the Anti Corruption Commission (ACC) Hassan Luthfee has said there may be an extended delay before work is resumed on GMR’s development of Ibrahim Nasir International Airport (INIA).

“It will take some time. It is not easy for us to finish it,” said Luthfee.

CEO of GMR Maldives Andrew Harrison last week said that no work had been completed on the site since August 2.

Work was initially halted due to issues relating to missing permits – an issue which Harrison said had now been resolved.

Luthfee said today that the government was now waiting for the ACC to finish its three cases concerning the Indian infrastructure company’s deal which was signed under the presidency of Mohamed Nasheed in 2010.

At US$511 million deal represents the largest foreign investment deal in the country’s history.

Luthfee refuted local media reports that two of the three cases will be completed by this Saturday.

“We have started the investigations and analysed the agreements and maybe we will finish our first reports in two weeks,” said Luthfee.

Luthfee was also keen to correct media reports that the ACC had requested a foreign expert to help specifically with the GMR investigations.

He stated that the ACC had been seeking an expert for assistance with all of the commission’s work but had struggled to accommodate one within the current budget.

Luthfee also added that the investigation would be conducted in conjunction with the Auditor General (AG) in order to give the process “greater transparency.”

Following a Supreme Court ruling on a separate case last week, Luthfee argued that the ACC was powerless without greater powers to prevent corruption.

“In other countries, Anti Corruption Commissions have the powers of investigation, prevention and creating awareness. If an institution responsible for fighting corruption does not have these powers then it is useless,” he said.

President’s Spokesman Abbas Adil Riza, who was not responding to calls at time of press, told local media yesterday that the government would not be able to take any decision regarding the GMR project until the ACC’s investigations were completed.

“ACC’s decision on the issue is very important for the government; it would assist the government in resolving this issue. There’s no legal action the government can take otherwise,” Abbas told Sun Online.

In June, pro-government parties re-affirmed a joint 2010 agreement calling for nationalisation of the airport.

The leader of one of these parties, Gasim Ibrahim of the Jumhooree Party (JP), was quoted in local media yesterday as saying he would oppose the GMR deal for as long as he lived.

These comments closely followed media reports that GMR had terminated the credit facility of Gasim’s Villa Air company after it had amassed MVR 17 million ($US1.1million) in unpaid bills.

There was no one from Villa Air available for comment at the time of press.

Fellow national unity government party, the Dhivehi Qaumee Party (DQP), filed a case last November against the introduction of an Airport Development Charge (ADC) which had been key to financing the project.

The DQP also produced a document criticising the deal and drawing parallels between foreign investment and colonialism.

After the Civil Court ruled the ADC an illegal tax, the Nasheed government reached an interim arrangement whereby GMR would deduct the lost revenue from the concessionary payments owed to the government.

This issue has become a major point of friction with the new government which subsequently declared this interim arrangement illegal also.

Transport Minister Dr Ahmed Shamheed, also not responding to calls today, met with India’s Civil Aviation Minister last week, informing him of the issues with the GMR project.

“The Civil Aviation Minister talked about this issue in detail, while we were on the subject of foreign investments. Until now, the Indian government had been aware only that the Maldivian government has an agreement with GMR. So we took the opportunity to explain the problems associated with this agreement. It was a good chance to inform them of this,” Shamheed told Sun Online.

Whilst Shamheed visited India, President Dr Mohamed Waheed Hassan, was in China where as well as meeting with prominent businessmen, he told the China-Eurasia Economy Development and Cooperation Forum that the Maldives was “open for business”.

The government recently sent a statement to the Commonwealth Ministerial Action Group (CMAG), arguing that the stigma of being on the group’s investigative agenda was deterring foreign investment in the country.

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One Comment on "Progress on GMR project awaits ACC investigations"

  1. jameel on Tue, 11th Sep 2012 7:06 AM 

    This whole thing is a mess. The deal was a mess in the first place and now Gasim’s involvement is creating a further mess.
    He owns an airport and an airline. How can he or his party be in charge of the aviation and transport sector?
    Isn’t this a conflict of interest?

    Of course if GMR agreement fails Gasim would win as the contract says that only 3 airports in Maldives, namely Hulule, Gan and Hanimaadhoo can be International airport. So Maamigili cannot be an international airport.
    Maybe ACC should also look at this too with a JP person in charge of the transport sector.
    The airport development charge should be given but within a given period.
    I wish someone sensible would take charge and solve this issues.
    What is happening to Maldives? Isn’t there anyone who is not interested in raping the people and grabbing more money from the people? May Almighty Allah saves us from these mad people who are only interested in enriching themselves.

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